Andy and his wife were just about to use their 87,000 accumulated rewards points to take a vacation when all of a sudden Citibank closed the account and took away all their points. According to customer service, there’s nothing that can be done.

Andy writes:

After 5 years without a late payment and paying my balance off every month, Citibank closed my Credit Card account without warning and took the 87,000 ($870) rewards points we had accumulated. My wife and I were saving the points for a trip to Hawaii in October and we were just about the pull the trigger when we logged into our rewards program and the account was short 87,000 points. That’s $87,000 we spent to get those rewards. They said they closed the account because they had new rules required for the accounts based on rules from Equifax. I checked eqiufax and I have 39 accounts in good standing and one negative from a $1.32 balance from 2008 that was resolved.

I called customer service and they said there was nothing they could do since THEY closed the account. Normally you have 30 days after the account closes to use the rewards, but not in this case. I also just received my last statement from them on August 5th and it says nothing about the account being closed or that it was closed on July 30th. We logged into our Citibank online account as recently as July 28th and it said nothing about the pending closure. I logged into my rewards points account as recently as August 3rd and it said nothing about 87,000 rewards being forfeited.

One good thing is that they will keep my account open so I can pay off my balance that I accumulated in the month of July! However, I guess I won’t be getting any points for the $10,500 I spent in July.

Right now, I’m just really frustrated. I feel like someone has just stolen $870 out of my vacation fund and after I found the perpetrator, they won’t do anything about it. Funny thing is, I have 3 other accounts with them in good standing that I am now going to close myself and I will never do business with them again.

Thanks For Listening.

Andy

Yep. Rewards points are like arcade tokens. They let you play all the games you want but if the arcade closes down, you’re stuck holding goose eggs. You could try escalating your complaint based off of a threat to close your other accounts with them, maybe they’ll relent and let you have the 30 days to cash out the points.

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Call in, ASK for retention – tell them the issue, and threaten to close your accounts – if they give you back your points, use them – then close your accounts… if they refuse to help out or try to bargain with some interest rate or “bonus” points on other cards…

CLOSE THE ACCOUNT…. as a former Citi Cards employee…. there are only two types of accounts which cannot be reopened… “Deceased” (yeah that’s a bitch when it’s an accident, too) and “Fraud.”

Everything else is fair game… if they say they can’t reopen the account, they are LYING.
There are specific CODES in which the system does some sort of safe lock to prevent ANY user from opening or overriding (I mean of, course, at a programmer level they could reopen it). So unless your account was any one that I mentioned, there is someone at the supervisor level that can reopen it, ESPECIALLY if they are in retention.

Again, Citi respose – Miles are uploaded to AA every month… I’ve seen people call and complain “why am I not seeing the 10,000 miles I accumulated last week on my AA account?”
Simple, THAT system is in place and if you lose your points after it’s been uploaded, it’s AA, before – it’s Citi – you can usually corrolate (sp?) that with your billing statement.

AA are the few people who generally don’t have to worry – but fair warning, after 3 years, your points you’ve accumulated from that date 3 years ago will expire, month… by month…. USE YOUR POINTS!

I vote for small claims as well. IANAL and I know absolutely nothing about contract law, but I would guess that even if Citibank is legally in the right, it’s not worth their time to show up, so they’ll just pay.

Except with rewards payments, they are giving some of it back to him, so he really isn’t all that profitable. They charge 2% of total purchase price.They give him back 1%. So people pay their balance off each month and the credit card companies end up getting only 1/2 of the fees they normally would b/c this person gets rewards. Plus, they aren’t getting interest off these people.

In the end, his fees are being paid by everyone, even non-credit card users (in the form of higher prices that businesses charge to cover fees.) His bringing money in to the cc companies is causing people like me, who don’t use cc and don’t get a cash discount, to cover his cc fees. So basically other people are paying for his rewards. It’s called credit card free loading. I don’t feel a bit sorry for people who play the system to get free shit while I get charged higher prices by businesses to make up for the credit card fees. It’s welfare for the rich.

Citibank sucks for taking back the points, but they shouldn’t be giving them out in the first place.

The more money you have, the more likely you are to be able to rack up big credit card purchases every month (thus generating lots of rewards points) and then just pay the balance off in its entirety. How many poor people do you know who could put $10,000 on a cc in one month and then just pay it off in total?

Doesn’t it say on all of those CC deals in the fine print that they reserve the right to close the program at any time? I know mine do. Also, you spend 10,500 dollars a month on your credit card and pay it off every month…and your pissing over $870 dollars. Pshaw. I wish I had that problem.

That’s why its a credit card… you don’t have to pay that up front. Sure they have been paying off the balance (a reasonable amount) up to this point but the poster says he’s going to pay off the remaining 10k balance from July, and states no time frame. In addition, the 87,000 points were BEFORE the 10k purchase from July, so the 1470 a month figure still stands.

You know you can buy virtually ANYTHING with a credit card, right? Just because he spent $10,000 in one month does not make it routine. He could have had a deck built, bought a car, had remodeling done… tons of things. Regardless of any class warfare, he had almost $1,000 essentially stolen from him. You would be pissed if it was you.

Yes- they are legally allowed to terminate your rewards program at any time. Most companies, however, will give you a redemption period (aka 30 days) to redeem your points- but they do this only to avoid publicity like this.

i did this on a bunch of my cards recently and nothing happened. it’s called life. like car. or engagement ring. or vacation. or balance transfer. or home renovation. it would be silly for a one-time jump like this to warrant closing a credit card. you’d have to close everyone’ eventually.

You seem to have more money now and are giving us a slice of it. We would like to take this moment to destroy your confidence in us. It is our pleasure to make sure the door doesn’t hit you as you storm out.

I pull out my points at $50 or $100 (whichever is allowed) instead of ever letting them just sit and accumulate. I always assume a sitting account with $100s of dollars to be redeemed is just asking to be looked at. You could still open a side savings account and put the rewards in for a trip or whatever you are saving for, too.

Actually, that’s not true… I used to be a business analyst for a different credit card company (I know, I know, I’m one of the bad guys). Not carrying a balance is actually good in a lot of ways- credit card companies still make money from interchange, which can be quite significant. If you are a long-time customer, who is a high-spender who pays off your credit card in full every month, it basically gives the credit card company tons of interchange with minimal risk of you charging off.

One of the misconceptions is that credit card companies LOVE subprime customers, because they make so much money on fees, etc.- the problem is that these customers are actually quite risky, so the fees are pretty much needed to balance out risk. Subprime customers wouldn’t be able to get credit at all if it wasn’t for ways to get revenue besides interchange. Targeting subprime customers has blown up in a lot of company’s faces, because they failed to account for the huge level of risk. The charge-off rates of credit cards are actually ridiculously high (I had no idea before I started my job), especially in subprime markets. Don’t get me wrong, companies can make a lot of money from them when they do it correctly, but it is hard to do.

A lot of posters have commented, “why did the OP wait for so long to cash out the points?”

If it’s like some programs, you get a higher rate of exchange (dollars for points) the longer you let the points accumulate. For example, WorldPoints on a Bank of America Visa starts off at a half a cent per point (2,500 points yields $12.50), but once you reach 25,000 points, you’re getting a whole penny a point (25,000 points gets you $250, and that’s their plateau).

So maybe the OP was holding onto points so that upon redemption, he got twice as much cash for them as they’d be worth by just cashing out at the lower redemption levels. It’s a gamble but a way to essentially double your money for free.

I guess I feel kinda good about not being able to save points for the life of me and getting Starbucks gift cards. I’m closing out my account with them next month in either case– gettin’ paid, gettin’ paid.
As for the article, Citi is based out of the eighth level of hell, I wish this dude the best in battling Satan’s serpents.

Yes, Citi has the legal right to do what they did, but it wasn’t ethically right. I’d raise a stink about it. EECB, post on web blogs, tell your local Media (in my market, there’s plenty of reporters who cover consumers), make sure Citi loses more than $870 in bad press. It may not get your reward points back, but at least it’ll make you feel better

I was listening to Dave Ramsey yesterday, and he commented on an email from someone who asked if it was OK to use a credit card for cash back purchases, and then pay it off every month because they pay no interest and get rewards.

His answer was something like this…dealing with credit card companies is like dealing with snakes. Sooner or later you’re gonna get bit.

I too have zero balances on my cards, and use them to get cash back & other perks…now I’m seriously rethinking this approach. If Citi can do this, what about Discover?

I’m a Dave Ramsey fan, and that’s the first thing I thought of when I saw this. A lot of people disagree with his stance on not using credits cards, for the very reason that they get rewards points for spending.

Then something like this happens and reminds us all that when you have a credit card, you are really at the mercy of the credit card company. Rewards points? Nah, think we’ll take those back. Low interest rate? Nah, we’ll hike it up to 30% for no good reason. That payment you sent on time? Sorry, we didn’t actually process it until the day after the due date, so you owe us $39 for our own incompetence. It’s all in that tiny print contract you signed.

Can’t say much about the rewards being yanked from under your nose, but if you’re paying your bills off in full every month, at least right now – the APR on the account doesn’t matter. Furthermore, online bill payment makes the payment processing part of the equation a lot more reliable.

If you pay it off in full every month so are paying no interest or fees, then even if you earn no rewards or cash back at all you’re still coming out ahead. In addition to the various protections that paying with a credit card can give you, you’ve got from the purchase date through the card-payment date to keep earning interest on the money you’ve spent.

Well that would mean that Dave Ramsey does not believe in an interest free loan to buy products? Seems MR Ramsey is not too bright. If I buy groceries on the 1st of the month, and my billing cycle is the 15th of the month, and my payment is due the 10th of the following month, that gives me a 40 day interest free loan. I also never have to carry cash which means it won’t get lost, or stolen. I don’t carry around a check book which has my address on it. I gain warranty protection that I do not have with cash. Even with zero rewards, a credit card offers something that has value., Dave Ramsey can pitch any stupid advice to anybody, but it does not mean it is good advice. Oprah can give good advice on weight loss, but Warren Buffet and Bill Gates use credit, and Dave Ramsey is a radio host.

If you’re paying them off every month, the risk/reward is very heavily in your favor. Ramsey errs on the side of caution, because the main concern is people who overspend and hence start having to pay interest. I don’t know what the rate on my credit cards is, and I really couldn’t care less. Paid interest just once (except times when the credit card cash advance rate was less than my after-tax savings acct rate, so I was making money by carrying a balance), made a boneheaded mistake and put the decimal in the wrong place for an online payment.

The motivation matters. It’s not a good idea to make a purchase because you can get cash back. It’s different when it’s a purchase that you would make regardless, and the decision is merely what method (cash, check, CC) of payment would benefit you the most.

If it was thankyou points, they kinda sit in their own account are not tied to any airline and the value of the points vary widely depending on what you buy with them. some are fractions of a penny per point, i am looking a hotel deal on mine that ends up being close to 2 cents per point. Also a lot of things generate bonus points for things like food/gas, for me rent on my apartment is double points, so just food, rent and gas is over a 1000 points a month without even any discretionary spending. So them accumulating 80,000 points is completely possible over a few years.

Not to play blame the OP, but I guess I am. Why has nobody commented on the fact that this person had *39* accounts in good standing, including four with Citibank? There’s a limit on how many credit accounts one person needs, and in this credit climate, it shouldn’t be surprising to see some of them disappear quickly when the number is this high.

I don’t think this was 39 currently open accounts. This is likely a lifetime of small to large loans.

Each mortgage (if you tend to 3 year terms, you get a “new” mortgage every 3 years) is an account. Car loan. Student loan. Any past credit card. Store card. Line of Credit, empty or never used. “No interest no money down” furniture buys, paid off.

Live 15-20 years after college, married (maybe a couple marriages), own houses, sign up for store cards… yeah, someone could reasonably accumulate 39 past debts (accounts).

You OP blamers are REALLY reaching on this one. I know you *need* to blame the OP every time in order to feel safe, but this guy did everything right.

Paid off his balances each month. Had a good reward program. Saved up instead of wasting points on blenders and such. Monitored his accounts, checked balances, read his statements, even read all the contracts.

Citi just up and screwed him for no good reason. There was nothing he should have done differently. He did it all correctly and just plain got screwed and yes, it could happen to you or me. There is no protection other than lots of us constantly pushing banks that we won’t tolerate this behavior.

Blaming the victims will only encourage banks to do this to everyone, including you some day and no matter how much you are sure you’ll never make a mistake, that won’t matter.

It’s happened to me on a much smaller scale. I had about $25 in Best Buy reward points saved up and they sent some crap in the mail saying “we are cycling our points now…” and reduced my point total to 0.

It is not stealing. Best Buy is VERY clear about their rewards points up front, USE EM OR LOSE EM. It is in the contract. I know that for sure. If it is in the contract it does not matter.
Here is an example why it is legal. You take a job with 2 weeks vacation. You were always able to carry over your vacation from year to year. After 5 years, the new rule is communicated to you. All vacation time MUST be used in the year it is accrued. You have 6 weeks saved up. Unless you get something in writing, they are well within their rights to do it. It is not theft, even though you earned it when the rules were different.
It may suck, you may not like it, but you are the one who agreed to the terms and conditions.

1. It is shitty customer service
2. It is not theft, fraud, robbery, assault, murder or any other crime. It is a contracts case.
3. I have not read this specific contract, BUT every rewards contract I have ever read reads something to the effect “we reserve the right to change, cancel, discontinue the program for any reason”
4. If the OP’s does not have this, he could file a civil case against them. I doubt that is the case though

1. Do a EECB to Citibank. That should get the points back.
2. Write Consumer Protection in your state. That should shake the tree if #1 doesn’t.

I will echo what others have said. I used to have a Citi MasterCard. I would cash in my ThankYou points for $50 or $100 gift cards IMMEDIATELY. When they changed the program from 5 points for every dollar at grocery, gas and drug stores to 1 (just like all other purchases), I shut the card down.

Even if you pay off your account each month, the bank is still making money off of you because the bank charges a retailer for each sale. When I was in business, it was about 3% but that varies according to volume and bank and I don’t know what it is now. One reason why a lot of retailers won’t take American Express is that their commission is higher.

Ok, here’s what you do. Call general customer service, ask for a supervisor, and then when you get to that group (which is really called CRT, Customer Relations Team), ask for either the Office of the President or Presidential, they’ll know what you’re talking about. It’s a small specialty group in South Dakota (home office of usury central) who have the power to do anything they want on any card. Even if it doesn’t exist in the system. CRT (supervisors), have the power to change just about anything on a card (trust me I know, I was authorized to credit someone $16k in finance charges).

When you either get transferred to presidential or get a call back from them get the name and extension/direct number of whoever you talk to, or their e-mail. Mention in no uncertain terms that you will contact the BBB and your local news media concerning this. They hate that.

The same exact thing just happened to us on our business accounts we had merged. Our balances are extremely high as we put everything allowable on it, including our other bills. The account is paid off in full every month. In January, 2010 we had a late payment to our mortgage company due to a bounced check as a result of someone else’s check bouncing in our account. It was immediately settled when we found the problem and the mortgage company refunded our late charge, yet it got sent to the credit reporting companies. It even states the payment was made on the credit report. We have no other glitches on our credit report. I just tried to check our rewards balance today and found out we lost the rewards. Ours were probably a couple hundred thousand points. We save ours for the fall/winter when we travel only to find out they are lost. We should probably band together to fight this injustice. We are being punished and have done nothing wrong!!